The figures released by Skolverket show that 13.1 percent of pupils in spring didn't pass the core subjects at the end of the compulsory nine-year school (Grundskola). Students have to pass the subjects to be able to continue their studies in upper secondary, known in Sweden as Gymnasium.
In 2006 when the Alliance was elected the failure rate was 10.6 percent and considered alarming at the time. By 2010 the figure had increased to over 12 percent.
"It's a very grim figure, it has increased and continues to rise and that is a bad result for Swedish schools," Director General Anna Ekström told SVT who analysed the findings.
The agency says they are concerned about the findings which demonstrate how vital a child's background is when it comes to doing well at school.
For example the figures show that only five percent of children whose parents are university graduates fail to gain entry to upper secondary.
Children of parents who just completed Gymnasium make up 15 percent, while the figure rockets to 42 percent for children whose parents also failed to pass the core subjects at Grundskola.
Under the Swedish education act everybody is entitled to a good education but the figures make for alarming reading said Ekström of Skolverket.
"Everybody should be able to develop to their full potential," she said and added that the differences between various schools continued to increase.
However, the figures also showed that children of immigrant backgrounds did just as well or even better than native Swedes. That applied to children who had been in Sweden for between eight and nine years.
By contrast children who have recently arrived had a much higher failure rate – 50 percent – precluding them from entering upper secondary school.
Girls continue to outperform boys according to the study. In April The Local reported that Sweden had tumbled down the Pisa rankings with Swedish kids scoring the lowest marks in the Nordic region.